Kutxabank Prepares the Sale of Residential Land Worth €700M

26 February 2018 – Eje Prime

Kutxabank is awakening from its lethargy in the Spanish real estate sector. The Basque bank, which resulted from the merger of three savings banks from the region (Kutxa, BBK and Caja Vital), wants to get rid of 40% of its portfolio of toxic assets, which would mean launching onto the market a portfolio of land and promotions worth between €500 million and €700 million.

This operation will be the second most important divestment to be undertaken by the financial entity, after it sold its real estate arm, Neinor Homes, to the fund Lone Star, back in 2015 for €930 million.

The objective of the bank is to take advantage of the good times that the residential market in Spain is currently enjoying to place its assets with international funds and new property developers, according to Vozpópuli.

This option that Kutxabank is considering comes at a time when the sector is complaining about the lack of developable land, which means that it is likely that the bank will easily find groups interested in acquiring its land. The plots are largely inherited from the merged Cajasur, a Cordoban entity that BBK integrated in 2010.

If it carries out the transaction, Kutxabank would join Santander and BBVA on the roadmap of Spanish banks with respect to real estate. The sale of a large part of the property held by two of the country’s major financial institutions last year, both to US funds, set a course that other smaller banks are now starting to follow.

Original story: Eje Prime

Translation: Carmel Drake

Asur’s Two Hotels Go Up for Auction for €70M

30 November 2017 – ABC

The judge of Mercantile Court number 2 in Sevilla, Pedro Márquez, has approved the liquidation plan for the company Ámbito Sur Hoteles (Asur), which includes the direct sale, by auction, of the two production units associated with the four-star hotels that the company owns in La Línea de la Concepción (Cádiz) and Isla Antilla (Huelva). Both are operated by the chain Ohtels. Asur, which also owns land in Manilva as well as 81 tourist apartments in La Línea, filed for liquidation after accumulating debt of €90 million, most of which corresponded to loans from Banco Popular (now Santander), Cajasur, Sabadell and Sareb (the so-called bad bank).

The Hotel Asur Campo de Gibraltar and its adjacent car park are worth €21 million, although the debt associated with that production unit amounts to €20.7 million, mostly loaned from Cajasur. Meanwhile, Hotel Asur Islantilla Suites & Spa has an asking price of €48.7 million and that is offset by loans amounting to €41.5 million, of which €38 million was initially granted by Banco Popular (now Santander). That hotel also houses a conference centre.

Although several creditor banks made a request for the mortgage debt over the hotels to be foreclosed, the judge from the Mercantile Court has ruled for them to be sold as separate production units, relegating the mortgage foreclosure to a subsequent time if the auction is abandoned (…).

The bankruptcy administrator, in the hands of the law firm Maio Martínez Escribano, will receive offers for the hotels and the two plots of land in Manilva until 16 December. If by then it has not received any offers for more than 75% of the real value of the estates, then the period for the submission of offers will be extended by one month, to 16 January.

If an offer is received for less than 75% of the real value of the hotels, the main creditors (Cajasur in the case of the hotel in Campo de Gibraltar and Santander in the case of the hotel in Islantilla) will have to approve the operation. The bankruptcy administrator will have the power to choose the most favourable offer without having to obtain legal authorisation for the sale.

In the event that the two hotels are not sold directly through this first auction, the sale will be undertaken through a specialist entity, such as a real estate consultancy firm, which will be granted a five-month period to that end. If that sales option also fails, a “dación en pago” of the properties will be carried out. Only in the event that the hotels cannot be sold in that way either will the properties be auctioned off individually and not as production units.

The history of Asur

The company Asur was created in 2010 by the Basque group Bruesa Construcción and the Nazarene real estate company Baremos Área Inversiones (…).

Original story: ABC (by M. J. Pereira)

Translation: Carmel Drake

Neinor Buys 7 Plots Of Buildable Land In El Cañaveral (Madrid)

27 December 2016 – El Confidencial

Developments in the south-east of Madrid have come under the spotlight of Neinor, one of the largest property developers in Spain, which has just marked a turning point with the purchase of several plots of buildable land in El Cañaveral, the most advanced neighbourhood in the capital’s ambitious expansion project.

The company led by Juan Velayos has acquired seven plots of land, with a combined buildable area of 47,000 m2, where it plans to start to build almost 500 homes, according to sources familiar with the transaction. The company itself has declined to make any comments.

Specifically, Neinor wants to construct 24 detached homes and 459 multi-family homes, plans which would lead to the definitive launch of El Cañaveral, where 14,000 homes are expected to be created in total, to house a population of around 50,000 people.

Nevertheless, Velayos’ plans for this development go much further, given that it is one of the few areas in Madrid where it is possible to buy buildable land, in other words, land that is ready to be developed.

According to the same sources, the company is holding advanced conversations to acquire four other plots, whose buildability exceeds 11,300 m2 and where it hopes to build another 95 homes.

Appetite for growth

Since its re-launch just over a year ago, Neinor has shown a strong appetite for growth, and to achieve that objective, it is actively searching for blocks of buildable land where it will be able to start to build new homes quickly.

In fact, the road map that the company announced at the end of 2015 aims to develop around 3,000 homes per year and to establish a permanent bank of land to enable it to build 10,000 homes. (…).

In addition to these ambitious business plans, another major corporate challenge promises to mark Neinor’s future in 2017, namely, its debut on the stock market. It is already working on the IPO and the size of the company will play an important role in its success.

The current firm Neinor was created by Lone Star, one of the international funds that was most committed to Spain during the worst years of the crisis, from the foundations of Kutxabank’s former real estate group.

This company, named Neinor by the Basque entity, was created in 2012 from the sum of the different real estate activities of the Basque former savings banks – BBK, Vital and Kutxa – and the Andalucían entity Cajasur.

Lone Star bought the property developer at the end of 2014 for €930 million, in an operation that represented a real milestone for the real estate sector, which was still licking its wounds, given that it represented the largest transaction by a company in the sector since the outbreak of the crisis.

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake

Half Of Cruzcampo’s Former Site In Sevilla Goes Up For Sale

13 June 2016 – Andalucía Información

Investors and governments alike are trying to take advantage of the improvement in the economic environment to reactivate the real estate market in Sevilla. Whilst on Thursday, the Town Planning department put 19 plots of land in Sevilla, on which 1,440 homes may be built, up for forced sale through public auction, now comes the mandate for the confidential sale of half of the urban development rights over the large site of the former Cruzcampo factory, where the PGOU has authorised the construction of 1,963 homes, in addition to tertiary uses.

The site of the historical brewery on Avenida de Andalucía had gone from being a star project to a failing project. The Basque real estate company Urvasco, which acquired the plot during the golden years of the real estate boom, commissioned the design of a “high standing” neighbourhood to four of the star-architects at the time: Norman Foster, Jean Nouvel, Arata Isozaki and Guillermo Vázquez Consuegra, who…even had their photo taken together with Monteserín, the then mayor, on the balcony of the Town Hall, in 2006. At the time, sourcecs spoke about an investment of €750 million in the construction of a luxury neighbourhood that was going to boast a high category hotel with around 150 rooms.

Nevertheless, with the burst of the (real estate) bubble just two years later, the project ended up foundering, along with its developer, Urvasco, which was unable to meet its obligations with the banks that had lent it €330 million and so it had to hand over the land to a pool of financial entities and companies linked to them (around a dozen in total).

The ‘Compañía para los Desarrollos Inmobiliarios de la Ciudad de Híspalis’ is the owner of half of the urban development rights of this land (49.91% to be exact). The Company was constituted by Banco Popular, CajaSur, Caja Granada, Caja España, Caixa Catalunya, Cajastur, Caja Laboral, Bancaja and Caja de Ahorros de Extremadura.

This company, which had accumulated debt amounting to €294 million and losses of €200 million, filed for voluntary bankruptcy in January 2016 in the Commercial Court of Madrid, and its application was approved on 22 February. However, that has not represented an obstacle to the process to sell its urban development rights, entrusted to an intermediary company, which is looking for potential investors in a restricted process that will run until Friday (17 June), the deadline for the acceptance of offers.

The sales brochure highlights that the plot has a surface area of 18,286 sqm and is located just 400m from El Corte Inglés on Nervión Plaza (presented as the main shopping centre in Sevilla), as well as from Sevilla F.C.’s stadium and the Santa Justa train station.

The Interior Reform Plan definitively approved the development of 1,963 homes, of which 890 will be allocated for social housing, as part of a total constructible area for residential use of 225,823 sqm, as well as a further 29,345 sqm for tertiary use. Therefore, the gross buildable area amounts to 255,168 sqm.

All of this will be constructed on wide blocks located in the Southern area of the plot. The Northern section will be a green area covering more than 70,000 sqm. According to the sales brochure, “the proposed plans seeks to achieve a maximum liberation of space, of around 35% in total, for the enjoyment of citizens. To achieve this, the plans propose the construction of tall buildings, which in the case of the residential units will be 15-storeys high”.

Original story: Andalucía Información (by M. J. Florencino)

Translation: Carmel Drake

Neinor Wants To Sell 1,000 Homes In Andalucía

21 July 2015 – El País

The residential property developer Neinor Homes has announced its new real estate project for Andalucia, where in addition to continuing to market CajaSur Inmobiliaria’s portfolio, it also expects to sell 1,000 homes and reach a cumulative investment of €200 million by purchasing buildable land. The real estate company has opened a new office in Córdoba, from where it will coordinate its expansion across the autonomous region.

Neinor Homes, which was launched in May of this year, is committed to marketing residential assets from both Kutxabank, as well as from its subsidiary CajaSur, throughout Spain over the next seven years. It also owns a stock of land for the new development of more than 5,000 homes and its business plan for 2015 includes a domestic investment of around €1,000 million to purchase land.

For the time being, Neinor’s own residential portfolio of finished products, which the firm has started to market in Andalucía, contains approximately 500 homes, including properties in developments such as Benalmádena Golf, the second phase of Residencial Duquesa de Manilva and Valle Romano.

Original story: El País

Translation: Carmel Drake

Best Mortgages Before The End Of 2014

29/12/2014 – Expansión

The last few days leading up to the end of 2014 have been filled with the habitual summaries, assessments and balance sheets.

As far as the mortgage market is concerned, over the past 12 months there has been a reduction in differentials that banks add to the Euribor, a reference rate that is added to most adjustable-rate mortgages signed in Spain, which has registered record lows.

These factors have resulted in a higher number of mortgages signed from June to October this year, the last month for which the National Statistics Institute (INE) has released data. The number has exceeded those of the same month back in 2013.

In October, 17,687 mortgages were signed, 18.0% more than a year ago. In September, 19,323 or 29.8% more than in the same month of 2013; in August – 15,040 (23.8% increase); in July – 18,107 (up 28.8%), and in June – 17,137 (19.0% more).

But let’s look over this bit by bit. The average overall differential of banks at the beginning of the year was at 2.788%, according to Bankimia indices calculator, whereas just a few days short of the end of the month, it has dropped to 2.136%. The reason behind this decline is the appearance of new mortgages in 2014 and interest rate reduction in some of the already existing ones.

And according to forecasts, the path of the mortgage for next year will be similar, with steady reductions in differentials.

At the end of November, the Euribor was at 0.335%, as confirmed by the Bank of Spain. This is the lowest level in history and the result of monetary measures taken during the past year by the European Central Bank, with reductions in interest rates, reaching all the way down to 0.05%.

As December comes to a close, the ten most outstanding bank mortgages, according to Bankimia mortgage comparison website, are the following:

1. CajaSur Mortgage, from CajaSur: It starts with a fixed interest rate of 2.50% during the first two years and then Euribor +1.25% for the remaining repayment period. To achieve these conditions, the holder must have their payroll deposited directly to the bank and purchase three insurance plans (payment protection, home and life), plus a card and a pension plan. CajaSur finances up to 80% of the appraised value of a first home.

2. Ahora Mortgage, from Liberbank: No sign-up fee, starts with an interest rate of 1.95% for the first 12 months and then the Euribor is applied at +1.50% for the rest of the repayment period. The bank requires the holder to have their payroll deposited directly or have certified income of above 2,000 euros a month, as well as purchase a comprehensive home insurance plan and each loan holder must sign up for a card issued by the bank. This product is marketed throughout the country except for branch offices in Asturias, Extremadura, Cantabria, Castilla-La Mancha, Avila and Lugo.

3. HipoteCasa db Mortgage, from Deutsche Bank: It has a fixed interest that starts at 2.25% for the first 12 months. For the rest of the repayment period, the interest rate is variable and based on Euribor +1.59%. All this is contingent upon whether the appraised value of the property, a first home, to purchase is equal to or greater than 100,000 euros.

In addition, the holder must set up direct payroll deposit and three basic bills to the bank, plus household income must be over 30,000 per year. It is also required to hire both a credit and debit card, plus three insurances: payment protection, home and life.

4. Hogar Mortgage, from Caja de Ingenieros: It finances up to 80% of the lesser value between the purchase or appraisal of the home being bought, which must be that of primary residence. Throughout the first year a fixed interest rate of 2.35% is applied, while for the rest of the period, the Euribor at +1.59%. To obtain these conditions, the holder must set up direct payroll deposit and three debit of three utility bills, have a minimum account balance of $3,000 and purchase three insurance policies (payment protection, home and life) along with a credit card.

5. Postal Mortgage, from BanCorreos: During the first 12 months a fixed interest rate of 2.5 % is applied, while for the rest of the repayment period, a differential of 1.59% is added to the Euribor. It finances up to 80% of the appraised value of the house with a minimum of 80,000 euros. The holder must be linked with the banks through direct payroll deposit and hiring of a home and life insurance, as well as a credit card and a pension plan.

6. Freedom + Mortgage, from Banco Mediolanum: A variable interest rate based on the Euribor +1.65% is applied throughout the repayment period. For the best terms and conditions, the bank requires mortgage-holders to set up direct payroll deposit, have income above 35,000 euros a year, or purchase a life insurance. It finances up to 80% of the appraised value of the home.

7. Unoe Mortgage, from Unoe: No sign-up fee. It has an interest rate based on the Euribor +1.65% if the payroll is directly deposited to the bank and if a home insurance as well as a single-premium financed life insurance policy is purchased along with it. It provides up to 80% of the appraised value of the property with a minimum of 30,000 euros.

8. Net Fidelis Mortgage, from Caja España-Duero: It can only be hired over the internet. The first 12 months bear interest at 2.25%, while to the rest of the repayment period applies Euribor +1.65%. To obtain this mortgage, the owner has to set up direct payroll deposit, hire insurance (life, payment protection and home), two cards and a pension plan through the bank. It finances the lesser value of 80% of the price of sale and appraisal.

9. Triodos Mortgage, from Triodos Bank: In this mortgage plan, the interest depends also on the energy rating of the house: the more sustainable, the more economical. Interest rate is based on the Euribor +1.65% if the holder also hires home and life insurance, sets up direct payroll deposit and direct debit of three utility bills, and signs up for both a credit and debit card.

10. Naranja Mortgage, from ING Direct: No commissions, the interest is the Euribor at +1.69% if the holder sets up direct payroll deposit or deposits at least 600 euros a month or maintains a minimum account balance of 2,000 euros, among others.

All these mortgages have a repayment period of up to 30 years. In the case of those offered by Unoe and ING Direct, the period goes up to 35 and 40 years, respectively.

The selection of loans was carried out among those offered by banks and did not take into account those aimed at specific target demographics, such as youths or civil servants, among others.

Original article: Expansión

Translation: Aura REE

No Truce at the Mortgage War: 12 Banks Offer Differentials Below 2%

29/08/2014 – Cinco Dias

In September 2008, all banks consistently started to refuse the loans as they saw one of the greatest recession on the planet was looming. However now, six years later, liquidity circles in the eurozone are going stable so financial entities can return to lending. Commercial leverages of their offices hand out mortgages, including those with homes as collaterals.

Large majority of the entities offer interest rate differentials below 2% plus Euribor for 12 months, whereas less than a year ago they could not afford for less than 3%. Bankinter was the first to break the pattern with a 1.95% + Euribor mortgage last year.

The challenge was soon accepted by the rest of the banks and reached its fever peak in the last months. ING Direct, Barclays, Deutsche Bank, Sabadell, Liberbank and Unoe are among those that trimmed their differentials below 2%.

Since July, BBVA is the number one with its up to (or down to) 1.7% + Euribor loan (2.25% in the first year). Obviously, the final price will depend of the economical record of the client and the loyalty products they buy together with the mortgage.

Aside from the competitive Cajasurs credit found exclusively in Andalusia and Extremadura, BBVA is second to no one. However, the spread of Santander (1.89%) treads on its heels.

According to data gathered by the Ministry of Public Works, the surplus cash in hands of banks currently exceeds €100 billion in the euro zone and the fact that the property prices have fallen by over 30% since the 2008 peak are key for recovery of the real estate market. The number of new mortgage approvals has already risen by 19%, as per information published by the National Insititute of Statistics (or INE by its acronym in Spanish).

The fierce deleveraging process run by financial entities and the necessity to return to their traditional business also impulsed the improvement in lending. Official statistics start to confirm the new credit flow. According to Spains central bank, in June mortgages with a house as collateral represented more than €767 billion, though still much less than in 2008. Furthermore, the INEs information tells that in the same month, the average interest rate in mortgages was equal to 3.88%, compared with the 4.37% rate from May 2013.

At the new war on mortgages – although far away from the differentials of 0.3% seen in 2006 and 2007 – internet banking smooths its offers out as well. Even if the rates are similar to those proposed by classical entities (i.e. slighly lower than 2%), less loyalty products are required. Most sophisticated in this field turns out to be Evo Banco that cuts in the differential if the Euribor reference goes up. In the first year of the credits life, a customer pays a fixed rate and after the term the differential declines in line with Euribor. Thus, given that it was set at between 2% and 4%, the rate will shrink by 0.2%, in case of a 4% to 6% one by 0.4% and so on, and so forth.

 

Original article: Cinco Días (by P. M. Simón & V. Gómez)

Translation: AURA REE

Cajasur Wipes Real Estate Assets Off the Books

11/04/2014 – ABC

At the end of 2013, Cajasur shed a considerable part of its property. Thanks to new legislation, the savings bank could sell part of the credit magnitude that pulled it down to bankruptcy.

In total, the entity sold four companies that gather all the unsuccessful investments carried out over the last decade: Sociedad de Gestión de Activos (SGA), Cajasur Inmobiliaria, Silene Activos Inmobiliarios and Prienesur. The purchaser is the bad bank of Grupo Kutxabank (a merger of BBK, Kutxa, Vital and Cajasur), Neinor Barria. The asset lot includes both unpaid mortgages and assets Cajasur received from resolved joint ventures with Arenal 2000 or Tremón. According to independent appraisers, the sale will bring around €112 million to the bank.

(…) The goal is to reduce holding of Kutxabank in the bad bank down to 30% by giving way to investors. (…).

 

 

Original article: ABC (by R.R.)

Translation: AURA REE

ING Direct Reduces Its Mortgage to Compete With Santander & Bankinter

23/01/2014 – Cinco Días

The battle of lowering the mortgage rates goes on. ING Direct reacted to the new campaign by Banco Santander (that reduced its mortgage by 1.99% over the Euribor few days ago) and has done cuts in its famous “Orange Mortgage” (“Hipoteca Naranja”). The Dutch institution lowers the differential added to the Euribor index also by 1.99% and the offer is destined both for its clients and the new clients.

By now, the best differential that ING Direct has been offering to its regular customers was 2.29% and 2.69% to the new ones. But now the bank only requires having an account with or without salary to obtain the 1.99% + Euribor mortgage. The maximum financing in regard to the appraisal value for the first flat will be of 80% and 75% for the second house, with the amortization term up to 40 years. As usual, the company offers no commission fees. However, one must sign not only the mandatory fire insurance, but also house and life insurances. (…)

The first bank to lower its mortgage differential was Cajasur that currently offers the best conditions in the market with 2.5% of the startup rate and 1.25% differential over the Euribor. (…).

Then Santander caught up with the idea and launched its new 1.99% + Euribor mortgage with the fixed rate of 2.95% in the first year (…).

Last year, Bankinter was the only entity that dared to go against the flow and released its “No More Mortgage” (“Hipoteca Sin Más”) under 2% + Euribor (1.95%). (…).

This way Bankinter, Cajasur, Santander and now also ING Direct are the mortgages below the 2% added to Euribor rate, the rest of the institutions do not go under 2.5%.

Source: Cinco Días